Money

Ex-Madoff accountant pleads guilty to aiding fraud

Joseph Ax, REUTERS

Tuesday, June 24, 2014
12:44:29 EDT PM

Paul Konigsberg (L), the former accountant and a former senior tax partner at Konigsberg Wolf & Co in New York, leaves the Manhattan federal courthouse after making bail, with his lawyer Reed Brodsky, in New York, Sept. 26, 2013. REUTERS/Zoran Milich

NEW YORK - Bernard Madoff's former accountant pleaded guilty on Tuesday to helping the convicted swindler perpetrate his massive Ponzi scheme.

Paul Konigsberg, 78, a former senior tax partner at Konigsberg Wolf & Co, pleaded guilty to one count of conspiracy and two counts of falsifying the records of a broker-dealer before U.S. District Judge Laura Taylor Swain in New York. He also agreed to forfeit US$4.4 million.

He became the 15th person to plead guilty or be convicted in connection with the fraud.

"I'm here today to take responsibility for what I did wrong," Konigsberg told Swain.

He said he had worked with others at Madoff's firm to manipulate customer account statements, including by backdating transactions, and then filed false tax returns based on those amended statements.

But he said he had not been aware that Madoff's entire investment advisory business was a massive fraud.

"It's important to me to say that I was not aware of Madoff's horrific and evil Ponzi scheme that brought so much suffering to so many," he told Swain.

Madoff, 76, is serving a 150-year prison sentence after pleading guilty in 2009 to running the decades-long fraud that was uncovered in December 2008 and estimated to have cost customers more than $17 billion in principal.

Konigsberg's plea came three months after a federal jury convicted five former Madoff aides on all counts following a months-long trial in New York.

The aides, including portfolio managers Annette Bongiorno and Joann Crupi, computer programmers Jerome O'Hara and George Perez, and back-office director Daniel Bonventre, have asked Swain to throw out their convictions.

Several former Madoff employees who have pleaded guilty testified for the government at the trial, including Madoff's former right-hand man, Frank DiPascali.

Other Madoff employees who pleaded guilty included his brother, Peter; another former accountant, David Friehling; and Enrica Cotellessa-Pitz, the controller for Madoff's firm.

Konigsberg faces up to 20 years in prison on the most serious count of falsifying records, as well as five years on each of the other two counts, when he is sentenced.

The case is U.S. v. O'Hara et al., U.S. District Court for the Southern District of New York, No. 10-228.